Apcims: 'messy' and 'confusing' RDR should allow grandfathering

The Association of Private Client Investment Managers and Stockbrokers (Apcims), disapproves of the FSA's decision to not allow grandfathering for the retail distribution review (RDR) and questions whether adviser charging will bring enough transparency.

Apcims' chief Tim May said that while the trade body supports many of the RDR's aims, such as greater professionalism, it believes there are missed opportunities. He said the lack of grandfathering as part of the regulation will mean that clients lose 'trusted, experienced advisers across the market place'.

May described aspects of the RDR as 'messy and confusing' from the consumer's perspective and expect modification may be necessary later down the line. For example, he questions whether the FSA's proposals to introduce transparent charging for advice really extends to full transparency and asks whether consumers fully understand fund pricing.

May also pointed to potential discrepancies between the RDR and the oncoming Mifid II and the potential for amendments to some of the key points underpinning the RDR.

'MIFID II remains the elephant in the room as there is no equivalent concept of restricted advisers in the text and trail commission is, in the latest parliamentary text, proposed to be disclosed but not necessarily banned for both discretionary portfolios and advice – the exact opposite to RDR. Submissions have been made to protect RDR and the latest Council text bans all trail, but no-one knows where this will end up.'

In a similar vein, the trade body also highlights a growing regulatory burden which its members are facing, and said a 'positive move in the change over to the Financial Conduct Authority (FCA) would be to mirror the successful government initiative of ‘one in one out’ - or even ‘one in two out’ - for regulations'.

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